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Will Millions of Newly Insured Patients Under Healthcare Reform Actually Be Insured?

Will Millions of Newly Insured Patients Under Healthcare Reform Actually Be Insured?
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healthcare reformMost of the recent discussion is about whether all or part of the Healthcare Act will get through the Supreme Court. But let’s assume for a moment that it does.

What then? Will the newly insured actually get coverage? It would seem that they would: the Patient Protection and Affordable Care Act (PPACA) proposes to spell out in considerable detail exactly what coverage private insurance companies must provide. There won’t be any difference in anybody’s coverage—right? Wrong!
In fact, the majority of those to be newly insured under healthcare reform changes will be insured by Medicaid. But Medicaid is not run by the federal government. It is administrated and regulated at the state level.
This means that the specifics of Medicaid coverage differ from state to state. And due to budget constraints, some states have already started cutting Medicaid benefits to lower and lower levels. For example, states are capping hospital stays:

  • Arizona plans to limit hospital coverage to 25 days a year (and stopped covering certain transplants for many months).
  • Hawaii plans to cut coverage to ten days a year with certain exemptions.
  • Other states have already limited hospital stays under Medicaid: the limit is 45 days in Florida, 30 in Mississippi, 24 in Arkansas, and 16 in Alabama.
  • If you need more hospital care than Medicaid allows, apparently you will have to pay out of your own pocket or else forgo needed care. Basically you are back to being uninsured.

In 2010, state spending on Medicaid jumped 8.8%, and consequently many states have also trimmed “optional” benefits such as vision and dental, and reduced reimbursements for doctors and hospitals. Not surprisingly, even more doctors are choosing to opt out of Medicaid.
The double standard that is built into the PPACA legislation is especially troubling. Private insurers will not be allowed to have any annual or lifetime caps whatsoever on the amount they will spend on an enrollee under the new law. At the same time, Medicaid, as a government program, will not be held to any standard. As John C. Goodman, president and CEO of the National Center for Policy Analysis and widely known as the “father of Health Savings Accounts,” noted last October in an article that brought this problem to our attention:
If a private insurance company denies a breast cancer patient a bone marrow transplant, that’s considered a moral outrage—even if the procedure is experimental and is later shown not to work anyway. If the Arizona Medicaid program denies people organ transplants that do work and save lives, that is considered an unfortunate budget issue.
The point is, individuals will be entering an extremely underfinanced and ineffective program. This will only get worse as more people enter the Medicaid pool, in effect creating a program that is hardly worth the money being paid for it. What is the point of getting more people insured if you are taking away much of what they will get? And as usual, it is the poorest people who will suffer from this political sleight-of-hand.
When the healthcare reform bill was being debated in Congress, ANH-USA suggested to legislators that they should at least incorporate one much needed reform to help poor people: be sure that uninsured patients do not pay more in a hospital than insured patients. As it stands now, uninsured patients get charged in full, which may mean $8 for an aspirin, while insured patients get their bills discounted after review by the insurer. Why not just legislate that hospitals cannot discriminate against the uninsured? This idea seems so basic to us, but got no interest at all from the drafters of the bill.
For more thoughts about the PPACA, please see our Healthcare Reform Overview as well as our earlier articles on the subject.

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